Energy & Petroleum Products
Crude Oil
Crude oil is traded globally across a wide range of grades whose values differ according to density, sulphur, yield profile, location and loading programme.
MARKET REFERENCES
How the market commonly references price
There is rarely one universal price for a physical commodity. Commercial value depends on the benchmark, specification, origin, destination, timing and logistics agreed between buyer and seller.
- Dated Brent / North Sea benchmarks
- Dubai & Oman benchmarks for Middle East crude
- Producer Official Selling Prices (OSPs)
TYPICAL COMMERCIAL STRUCTURE
How physical pricing is often built
Typical term or spot structure: benchmark average over an agreed pricing window ± grade / quality / location differential. Middle East producer cargoes may also be sold using an OSP expressed as a premium or discount to a regional benchmark.
PRICE DRIVERS
What moves the physical differential?
- API gravity and sulphur
- Refining yield and grade quality
- Load port and destination
- Freight and arbitrage economics
- Pricing window / bill-of-lading dates
PHYSICAL TRADE
Commercial considerations
Common bases include FOB load port, CFR/CIF destination and DES for some delivered structures. Pricing periods may reference days around bill of lading, month of loading or month of delivery.
The examples on this page describe common market conventions at a high level. Actual contracts can use different pricing periods, assessments, quality adjustments, Incoterms and negotiated differentials.
Market methodology reference: view source / methodology
PHYSICAL COMMODITY BROKERAGE
Discuss a Crude Oil requirement.
Share the specification, quantity, origin or destination, delivery basis and timing.